June 28th, 2009:

The illicit trade in cigarettes costs governments $40.5 billion in lost revenue every year, with losses falling disproportionately on low and middle income countries, and the benefits of international action are likely to far outweigh the costs, latest research has shown.

Released for the opening of the third intergovernmental negotiating body on the Protocol on the Illicit Trade in Tobacco Products (INB-3) in Geneva today, the reports “How eliminating the global illicit cigarette trade would increase tax revenue and save lives” by the International Union Against Tuberculosis and Lung Disease, and “Cost Benefit Analysis of the FCTC Protocol on Illicit Trade in Tobacco Products” by Paul Johnson and others, for ASH UK, add to mounting evidence that the costs of smuggling and other forms of illicit trade in tobacco are counted not only in the millions of lives lost but also in billions of government revenue lost through inaction.

“The case for coordinated worldwide action against tobacco smuggling and other forms of illicit trade in tobacco has never been stronger,” said Laurent Huber, director of the Framework Convention Alliance (FCA) a global alliance of more than 350 non-government organisations working on the global tobacco treaty. “There is no denying that government delegates arriving in Geneva today are faced with a week of difficult negotiations in the face of the global illicit tobacco trade. But they cannot leave this meeting justifying in action by saying it was too difficult – the costs are simply too great.”

The ASH UK report shows the potential financial and health benefits to the UK of a strong illicit trade protocol. It also provides a methodology that other researchers can use to measure the possible impact of the protocol in their own country. It provides powerful evidence in favour of a strong protocol, suggesting once again that it could lead to major advances in public health and to significant increases in tax revenues to governments across the world.

The International Union Against Tuberculosis and Lung Disease report, the most authoritative report yet produced on the extent of the global illicit trade in cigarettes, includes:

Updated country level estimates of the illicit cigarette market around the world, using 2007 data or as close to 2007 as available;

Evidence that higher income countries,where cigarettes are more expensive, have lower levels of cigarette smuggling than lower income countries, contrary to the tobacco industry claim that the overall level of smuggling is dependent on cigarette price;

Evidence that the burden of cigarette smuggling falls disproportionately on low and middle income countries,where the majority of the world’s tobacco users live; and

Estimates of the number of lives saved and revenue gained globally in the future if smuggling was eliminated. The report shows that 11.6 per cent of the global cigarette market is illicit, equivalent to 657 billion cigarettes a year and $40.5billion in lost revenue.

According to the report, if this illicit trade was eliminated, governments would gain, in principle immediately, at least $31 billion, and from 2030 onwards save over160,000 lives a year, resulting from an overall increase in cigarette price of 3.9 per cent and a consequent fall in consumption of 2.0 per cent. In just six years over a million lives would be saved, the vast majority of them in middle and low income countries.

The Illicit Trade Protocol is the first agreement to be negotiated under the Framework Convention on Tobacco Control (FCTC), the first global health treaty. Since the opening of the first working group for the FCTC on 25 October,1999, according to WHO estimates, 43,504,658 people will have died from tobacco-related diseases as of 9am, Monday June29, Geneva time.

The FCA believes that the protocol is essential to international progress on tobacco control.Smuggling and other forms of illicit trade in tobacco undermine national attempts to control tobacco use, particularly through taxation on tobacco products.Fighting smuggling and other forms of illicit trade in tobacco saves lives, helps fight organised crime and raises money.

Come Wednesday, smoking will be banned in all indoor areas at workplaces and in public spaces – and bars, nightclubs, clubs, saunas, massage parlours and mahjong parlours will no longer be exempt.

Many such venues are ready to comply, but several establishments could be a bit hazy when it comes to the spirit of the law, the Sunday Morning Post has learned.

Several venue owners and members of an association said they feared business would plummet as a result of the ban, and they would take a fairly lenient enforcement stance.

Chin Chun-wing, vice-chairman of the Bar and Club Association, a group which represents about 200 bars in the city, said he believed members would lose 50 per cent of their business as a result of the ban, the financial downturn and swine flu.

“We have to remove ashtrays, but honestly, if we find customers smoking, we can’t do much as business has already been very bad. We can’t stop them smoking and drive them out of there. We won’t do anything. We don’t want to annoy smoking customers, especially those drunken ones, who might react very unexpectedly,” Mr Chin said.

Mr Chin did say, however, that his group members would let offenders know about the smoking ban. “Being licence-holders, we have to display smoke-ban posters and stickers as required by the government, or we will have to worry about applications for licence renewals in the future.”

Christopher Cheung Ka-ning, managing director of the Hong Kong Mahjong Company, a parlour in Wan Chai and an industry delegate, pointed out that mahjong rooms provided customers with free cigarettes.

“We will remove ashtrays but still give out free cigarettes,” he said. “We can only try to discourage them [patrons] from smoking here.

“I will definitely try to persuade them [not to smoke] and I will ask staff to do so if they find customers smoking. But if they ignore us, we can’t do anything else.”

Mak Cheong, a nightclub owner and spokesman for the Federation of Hong Kong and Kowloon Ballroom and Nightclub Merchants, said his club would not even give “verbal notices to smoking customers”.

“If we find smoking customers, we won’t execute the ban,” he said. “We will just let the TCO [Tobacco Control Office] do it. We are not game to do the job. It means driving customers away.”

Under the law only offenders, not venue managers or landlords, may be summonsed by tobacco control inspectors. However, there are owners and managers who say they will play by the rules.

Ray Ng, co-owner of Halo and Volar, said he expected to see some losses from the ban, but his nightclubs were on board.
“Unfortunately, both our venues … are underground. Instead of going out to a balcony, I’m afraid our customers will have to walk up a staircase and come back in,” he said. “That’s unfortunate. Hopefully, in the long run, it will be better. Maybe fewer people will smoke.”

A spokesman for Wan Chai bar Mes Amis said there would be full compliance there, too. “We shall be toeing the line – no smoking, guaranteed,” the spokesman said. Ashtrays would be taken off the bar, and no-smoking signs would be hung up.
Gilbert Yeung Kei-lung, co-owner of Dragon-I, said his nightclub also backed the ban. “This is a world trend and I think the reason why the Hong Kong government and a lot of countries are doing this is for the good of people,” he said.

Lee Thomas, operations director for Beijing Club, Billion Club and Club No9, said his establishments would take no nonsense when it came to smoking on the premises.

The smoking ban “hasn’t affected the UK, it hasn’t affected America, it hasn’t affected Australia, it hasn’t affected Ireland”, he said. He said his clubs would all have legal balcony spaces for smoking.

Winners and losers
WINNERS
Anti-smoking advocates They’ve come a long way, but still have miles to go. Still, a victory’s a victory. Light ’em if you got ’em. (We’re just kidding, of course.)

Establishments with outdoor seating or balconies Smokers can puff away in peace, as long as venue operators don’t have an overhang blocking over 50 per cent of their outdoor space.

Tourists Even if handed a summons, there’s no mechanism to force visitors to show up to court, critics say.
Snitches An offender who smokes in a bar and leaves can still be slapped with a summons if a witness chooses to rat them out in court.
Your health Need we say more?

LOSERS
Smokers If caught by the city’s tobacco control inspectors, offenders can face a penalty of up to HK$5,000. That will change in September when the government switches to a fixed ticketing system of HK$1,500 per fine.

Tobacco companies Less puffing means less sales.

Bars and clubs in basement spaces or on the upper floors of commercial buildings Smokers may bolt for clubs with outdoor areas or balconies.

Smokers who drive with children in the car Plenty of people want to see this banned
Dan Kadison

Smokers lit up as usual to enjoy the final Saturday night of puffing in bars – before a full ban takes effect on Wednesday – with some feeling frustrated but others thinking it may help them quit the habit.

Non-smokers working in bars said they looked forward to the clean air that was long overdue.

Jacob Bluhme, a smoker and shipping company sales director, said he had already encountered smoking bans in Los Angeles, Chicago and Singapore.

“I hate the smoking ban,” he said, drawing on a cigarette in a Lan Kwai Fong pub. “Hong Kong is like my last safe haven.”
He said he might go out less at night as a result of the ban. “I might just stay home and have a cigarette on my balcony,” he said.

At the stroke of midnight on Tuesday, June 30, smoking will no longer be permitted in bars, nightclubs, clubs, massage venues, mahjong parlours and bathhouses.

But Christen Ho, 29, said she was comfortable with the ban, which she said would help her quit smoking. “I intend to quit anyway, so this can help a little bit,” Ms Ho said in a pub.

The full ban may worry some pub managers, but Warren McInnes, manager of The Keg on D’Aguilar Street in Central and a non-smoker, said he felt great about the whole thing.

“I will be extremely happy with the smoking ban when it comes into effect,” he said, adding that he believed the full ban would not have a big impact on his business.

The Keg would still sell cigarettes under the full smoking ban, as it was easy for smokers to walk a few steps and light up outdoors, he said.

“In a small bar like this, people can step outside and smoke.”

Bartender Sheela Guoung said she had long been hoping for clean air in her workplace.
“I’ve had coughing problem for six months. I need fresh air,” she said.

The punishment for lighting up in a smoke-free establishment will be a fine of up to HK$5,000.

_____________________________________________________________________

CTA, James Middleton

Dear Tobacco Control

last week I had a discussion with a friend who used to manage a bar in Shatin / Tai Wai. He is still a shareholder of the Railway Tavern in Shatin.

He told me his directors had said they thought TCO would take a lenient view on continued smoking and that they expected it to take 6 months before anything happened if they continued smoking and that in any case, they had no legal onus to stop people smoking in the pub.

The article below is clear what needs to be done and that is to follow overseas legislation on making the licensee responsible to prevent smoking in his premises or face the loss of the liquor / sauna / mahjong / night club licence. Licensees are already bound not to serve drunken people by law and the same should happen with smoking. In the meantime TCO should write to all licensees to inform them that their liquor / other licence renewals might be affected by allowing smoking to take place on their premises.

The comments of the mahjong parlours to continue to provide cigarettes is another reason why premises managers should be made responsible under the law with the threat of loss of licence for non compliance. It works everywhere else in the world so why not here ?

It seems obvious that smokers will step outside the bars and pubs and the Government must look at similar legislation overseas that bans smoking within 10 meters of a building entrance and on restaurant and bar patios.

We concur with your statement on smoking in cars with children present and look forward to the Government following overseas jurisdictions on plain packaging of cigarettes, point of sale displays and the regulation and control of tobacco ingredients as enacted by the US FDA and signed into law.

Even with the smoking ban going into full effect this week, anti-smoking advocates say there is still a lot more work to be done in the city.

First, the smoking ban was not completely effective, said James Middleton, chairman of the anti-tobacco committee Clear the Air. “I think overall most Hong Kong people are law-abiding and will comply.”

Still, the government needs more tobacco control inspectors, a law to ban smoking at venue entrances and outside seating areas and fines for landlords.

“At the moment, there’s no onus on the landlord,” he said. “They don’t put the legal onus on the landlord.”

The burden was on the person smoking – and it would be the locals who would face the brunt of the penalties, as tourists can fly out before paying their fines, he said.

“[Preventing] smoking in cars is probably the next thing that must happen, especially with children present,” Mr Middleton said. “They’ve done tests in the UK which show that the contents of the car, even with the window open, are up to 100 times more toxic than in a bar.”

Smoking in condominiums had also been targeted in other cities, he said.

Where should people smoke then? “Dig a hole in the ground and then they’re ready to go when they’re dead,” he replied.

Anthony Hedley, chairman of the department of community medicine at the University of Hong Kong, said the government should institute an annual “progressive tax hike” on cigarettes and close a loophole which allows tobacco companies to advertise on products such as watches.

“There are many other issues. There’s a long shopping list. Just to name one is the point-of-ale advertisements. We’ve still got faulty legislation at that level,” he said. “I was in Thailand recently and their point-of -sale registration is very effective. You can’t display cigarettes front-of-house in a 7-Eleven or any other shop. They have to be covered up.”

One government official said he had a “wish list” of his own. Ronald Lam Man-kin is the head of the Tobacco Control Office.
“We are trying, of course, to strive for a smoke-free environment,” he said. “So the next step forward may include, for the protection of children, forbidding smoking in cars or putting in place some smoke-free movie [content] restrictions. But that’s just a wish list.”

Judith Mackay, director of the Asian Consultancy on Tobacco Control, said Hong Kong, Singapore, Taiwan, Thailand and Mongolia were doing well with their anti-smoking measures, but more steps had to be taken. “I tend to rejoice in the fact that we have got this far because I remember what it used to be like.”

Shops should sell cigarettes in plain brown packs and Hong Kong should understand its obligations under the WHO Framework Convention on Tobacco Control, she added.